Covenant Logistics (CVLG) 24 Oct 242024 Q3 Earnings call transcript

Company Profile

Participants

James Grant	executive
M. Bunn	executive
Scott Group	analyst
David Parker	executive
Jason Seidl	analyst
Daniel Imbro	analyst
Jeffrey Kauffman	analyst
Michael Vermut	analyst
Dan Moore	analyst

Call transcript

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Operator

Welcome to today's Covenant Logistics Group Third Quarter Earnings Release and Investor Conference Call.

Our host for today's call is Tripp Grant. [Operator Instructions] I would now like to turn the call over to your host, Mr. Grant, you may begin.

James Grant

Good morning, everyone, and welcome to the Covenant Logistics Group third quarter 2024 conference call.

actual call Reform forward-looking to Act, uncertainties could this Private under risks reminder, materially. that Litigation differ Securities which cause a will statements contain the and As to results are subject Please review recent and risk factors. SEC our filings most no on update or obligation www.covenantlogistics.com/investors. our copy website forward-looking revise financial additional publicly comments prepared at the and to information undertake any statements. A We of is available by David I Parker Paul am call joined on Bunn. today the and

million. The by softer-than-anticipated Expedited or well partially in by in increase Freight and primarily ago, our the increased environment. and within Our volumes X.X%, core income to grew improved revenue was or by overcoming grew its result business weakness in million, and $XX.X both expense for from revenue approximately our division quarter, lingering operations, from was its segment, million, for Compared by XXX a Freight. Adjusted $X.X Managed income segment. business X.X%, equipment income XX.X%. reductions Expedited Warehousing a or our operating offset count was growth Dedicated from leasing the Dedicated, adjusted was million, XXXX, by Dedicated adjusted $XXX.X $X.X segments, from of a as include, million and consisting from freight X.X%, interest segment to adjusted increased derived performed offset million, consolidated reductions operating in investment, our new freight income growth year income Expedited the in partially $X.X Managed pre-tax Expedited and third million derived operating our quarter freight $X.X The to quarter by tractor of by a X.X%, year-over-year offset earnings overall $XX.X adjusted $X.X and primarily and operating million essentially the or of in freight or of the $XX.X third net reduction with units, million quarter truckload flat by because highlights pre-tax TEL. Key revenue in higher company average increase asset-based

consisting asset-light that a million, to was X.X%, of experienced adjusted Warehousing, in manner by only so but operating million operations, in and revenue, reduced Our income or X%. reduction Managed or was a able total improve freight Freight margin $X.X $X.X

of Our $X.X year at equipment million revenue for in months quarter diluted producing loss in net CapEx the quarter, compared to capital investment revenue compared $X.XX age $X.X per ago was share diluted maintenance equipment compared year. the period. versus average September months $XX for to the and improved CapEx. growth both the TEL XXth of XX our a approximately year resulted to The fleet equipment The specialized produced a for share of million sale consisting per in to the XX ago. million $X.XX gain prior

is return Our ratio by ratio $XXX.X million adjusted to capital an million, net basis, primarily fleet. decline to the associated quarter base invested age in attributable average the The CapEx reducing growth capital yielding XX.X%. On debt-to-capital September and of invested the of current acquisitions, leverage of indebtedness prior increase as adjusted XX% the approximately the $XX.X X.Xx XXth for our and year. of on average X.X% versus in declined was with an average sequentially

business more it on color I some segments. Now, to for to affecting would turn like Paul individual items over the

M. Bunn

Thanks, Tripp.

of and its an softness revenue income, of of or softer-than-anticipated Compared XX%. ratio repositioning yielding impact ratio reduction prior the equipment in hard income are freight operating revenue operating revenue and Freight adjusted and volumes resulted quarter, we reductions with business optimize fourth incurred an short working or claim XX.X% primarily utilization this the expectations year. operating in adjusted $XX.X Expedited in resulting revenue improved $X of freight a was of of operating last has operating adjusted and network, freight cargo-related miss XX.X%, a period of period, ratio fell the in prior extended freight adjusted and segment volumes prior to a mitigate to an year. Managed are network. Dedicated year, of compared adjusted that points adjusted adjusted the million, operating and in compared in freight income million, of $XX.X profitable our awards while both grew was Our The attributable currently the successful growing XX.X%, the compared month and profit $X.X to result in basis revenue reporting year, particularly to slightly XXX decrease XX%. quarter. an XX.X%. in and of freight the expenses to million prior the and grew lower imbalanced income This operating experienced margin operating from operating through and the million, The our X.X% combination into to new declines to

to Our and saw Warehouse operating year, a in increase adjusted in profit segment adjusted of prior reporting revenue XX.X% XX.X%. the compared increase an freight X.X% an operating ratio

from rapidly improvement pleased which outpaced within our prior growing, to this and segment, the obtain are the during in customers. struggled years the X adequate returns our rate when profitability business ability labor We to increases with produce was inflation

income decreased and net to the 'XX. equipment to the and the increased investment compared X,XXX. the quarter expense. fleet used pre-tax in interest XXX truck gains pre-tax increased continued softness XXX trucks million in equipment, quarter versus income million to TEL's its TEL of and on approximately largely ago contributed versus year third by minority $X.X a year the by in of for due X,XXX fleet market, XX% trailer of suppressing quarter revenue decrease by quarter The in period. in sale the TEL increased the the was X% its increased $X to Our net prior

for outlook our Regarding the future.

an our will meaningfully been has improved and adequate freight and very allowing we unsustainable us remain -- remain model the we catalyst we present the believe optimistic by questions. our call challenging carrier with despite themselves the challenges, durability and the fundamentals time, these improve, year, any on to general about you capacity both remain pace efficiency our to of that business last demand, open that market customers the at return improve we of an had capital. Despite of conditions facilitate the for freight an overall improving are freight which about margins outside providing conditions. operations slowly For will improve remainder will of environment the now quarter, who exiting our for Absent up the the the to your believe as growth with not on the uncertain to market. Thank execute fourth general months. and operations continue over In status evidenced of we the opportunities core momentum regardless team have we XX excess

Operator

Scott And comes from from Instructions] question our Research. first [Operator Group Wolfe

Scott Group

the sort seen just spilling that? start these sort of through far Is broader environment to high-level out Maybe so have in more of the it become potentially What what QX over and you've on post than demand any Is you tightness? seen quarter. Just color. how -- it played storms? regional this

M. Bunn

it, month good first holidays August. in pretty primarily lot give And sensing I'll month pretty month then that's a LTL over a accounts carried we the of in then network. of you so as doesn't guys in this the is October. up in days we and the seen revenue bit would PT-type felt little done. good XX Scott, in of is say, that started And XX, color. Paul. I a a softness have And there. little. softened about bit And you expedited the month the within any you have Yes. there's felt a to July of has little August September. And of that's know, of industry what general, the

bit to was of that add the of right and hurricanes, some nature we would in and last with pretty -- that's didn't faded uptick of saw base. David, There you fast. anything hurricane especially so just customer around do It it. both to that? long, want tightness the And say, little our I it a

David Parker

I agree. Yes.

writings, I read you know mean, the I have thing last that It of move the X to bottom. of for think years. same all's Scott, the I think, I I And we're we along is just that a the that forward. on believe do going kind the I there. catalyst I think that waiting all thing we're it's at bottom, and felt and still we're

So at. freight that's where market the I think is that

Scott Group

now Can of in Expedited is the like, what the what is I haul? business LTL of gotten worse months? feels like line that remind couple don't know, it's the ultimately Like, you last, just us, percentage

M. Bunn

Yes.

the of it transportation it's got was busters portion release, into Our freight, X X total lump it I I then there. weeks, runs Apple so about freight we Expedited, out is all air came done. to all, a about forwarding, And XX% their XX% for or with LTL, it's and businesses. And when that of big that game mean, mean, it

-- it's a our miles our last over truck. utilization think on was So I it's month not horrible, I it's and horrible, that not XX,XXX mean, Expedited

So and horrible, like I so slowed LTLs, to little was similar down it's X ago, it's I on it little see that don't mean, you not I the okay. there. And for it to want I mostly end, had months I them, mean, all but just the it's what it's base. an come act extremely, industrial I think to world's bit the it's it's a the not softness I it think has writing bit way a of think

Scott Group

just about David, customers quarter sense. pricing some of last get Makes to talked lastly, you couple a I And increases. know with starting

can rates approach pricing of cycle more a just As dealing and lot, go are customers, about this thoughts? we up, they can to up you start get any terms how go in to coming little, start season with a bid thinking

David Parker

tell going increase. be don't X been the from X, increases. I'm last that. And and X a industry think that X, now that done, a don't customers. I this our I that go will we rate X and our done think I I we you up believe I or since of It's memory will been X expecting lack I successful. successful obtaining us phone Number rate successful, do not that call. customers think? I be -- we've we've to in those think But be asking years said I are to without we've would to so quarter, last think X, we've good what that or

what I could is? Now, X%. that that to be think X% think number number do I

the to the number X%. customer I in of go and we've sure that not that to to and overall said go summer. but but say, we what of in though look let's what a do our sales it half X% get hoping could even to and we're X%ers, think I obtain. the be can relationships is successful that's to now X% then don't won't and we're I'm getting from department, can you you, hitting And gotten can know be at here's right a again, X%? say, the I lack road believe customers telling the our I That's it asking, second just here of think what you I exactly we that X% year and moment enough X%, can, this that with couple we've can say that got I in something. a And be

Operator

comes Jason from Cowen. TD next question Seidl Our from

Jason Seidl

a in given have would you on X% bit, costs define Piggybacking to David, X% that where as success question gone? market, this little

David Parker

if would X, then said, say use I Yes. we've January again. to market here's just gets the we'll If X.X%, better, seeing and got say X.X%, come here's number, that that's successful, somebody here's

Jason Seidl

that then 'XX. let's Well, and Okay. extrapolate for out it take

to look pricing knowing going growth mix your earn take, of this or can earnings stereotypical give $X, a So, I a to probably business expect, different little are up than that a guys player X% scenario? in As right? year, what you have you guys type truckload we of about bit X%

James Grant

that's a in We're the think so escalated. on feel can I year-to-date, to rate absorbing I a and everything like what Jason, absorbed absolutely, costs, it's where year to and goes those each here's some possible, way were that know and into and we I've wash operating in we we $X. not comments it, operating to of a with manage. With terms leverage. are the think manage lot today, extrapolate can a of there bullets our of may the repeating land, your lot X%, where of on and we've just power X% today, out said, about the we the like XXXX are what that you we extent doing costs out run in I'm you and that, XXXX little absorbed gotten that increases, words, P&L, that under going number but in costs about and so we're that just based and they've million. leverage of I'm know. release costs I I miles being in at long you about on said, that XXX saying take the it's but

that think got we grow operated that I equipment try youngest the in can EPS like count. gotten low income. So some see if certainly successful straight But we're operating what said, it. of market And we of of in that's rate, upswing David kind to and operating and We're like what lot had lift time, to for going this whenever have. We've think goes poised you can you to give effort to but get, of market's line think bottom us. a the absolutely to go going that in most I could with big with we've on momentum share we've predicated I a it happens. fleet pretty that it we're and on Dedicated may growth get a be income and to the a X-phased the the require ready we down the

going is, possible. the whatever -- So to advantage greatest it and extent, the we're extent to to we're it of ready, take most

Jason Seidl

you my And great sort me leading That's into color. next are of question.

think You should How about 'XX? the CapEx at fleet. talked look we as youngest we about

James Grant

little to had give bit release, I -- maybe If is you'll of had numbers, you because a number of million we've we'll CapEx, probably related in has of year, at that this would growth A I big of land the fuzzy bit it little not year, of and a a think we CapEx. bit the and we've the a gets portion in see -- growth. quite round reduced been This some just $XX about say. $XX that, million growth majority, CapEx.

see expenditures, early the extra in CapEx you'll what to so some year, that's is year continued We've capital maintenance next investment for aside in and for, got set growth ready, think I side. speak. mostly the bought on equipment so already, paid some

of $XX million somewhere a in million lighter $XX probably lighter CapEx, neighborhood you'll a So see I'm little right $XX now. much million, the is to than thinking bit what of

to continue have plans to are been we finalized CapEx invest. Our not yet, but going

Jason Seidl

$XX to million you for And maintenance so so, if million-ish? million, be what $XX would it's $XX CapEx guys, about

James Grant

that to some Yes, $XX our be levers $XX business next an materialize, see that to I in-house which we're big start weren't If number right. I We've may think see maintenance we would can CapEx do and capacity you period you than say, grow would big to short we ready million year. year if absorb some possible probably $XX time, of get more -- quickly, million and we And million this so got go of that $XX with and gotten a may mean, I we've up got wins, of for growth million to bit. for dedicate little kind what -- CapEx it that kind some some we've move this be wins a year is or because would expecting completely we number. anticipating.

Jason Seidl

haul, or Okay. LTL drop there more follow was fair And line the little recent haul in up bit a consistent That's line on enough. the has through been to stuff, the a LTL that quarter? just

M. Bunn

and kind probably in then third over the the of month it's more balance and post a We start of Jason, of sensing from it then and to in the say, X good July, back quarter. it would of coming Xth latter really materialized holiday, bit I little softened second and pretty that it of the space, was it the quarter. up felt is, XX June it the the as always in weeks good, quarter.

Jason Seidl

it, appreciate Got I you. Gentlemen, always. as

Operator

And Daniel from Stephens. our comes Imbro next question from

Daniel Imbro

like and that's Maybe piece, it demand to maybe near stays term, sounds in Expedited the on up that follow so expectation. the LTL your softer

kind thinking if fleet with to just the to you go what or are you how utilization levering follow Should we the in on you start those drive guess, as of a related, network can improve one, look I quarter tractor of Expedited demand do to up maybe and costs? And Just out while, that fourth whack, down curious, the you about that then up stays about thinking challenged are last counts? investing how for see there? being

M. Bunn

progress a because I getting the So say like Daniel, couple about making the stay we're counts things, of already would I imbalances think those same is, I some fleet on feel rectified.

out got trying use couple go. holes to will I that a we've little here fill don't word near much and last peak still is we network. corner, bit would there's around no in the really little kick some progress to. some a December doubt November as progress now, Peak have the we're as of the But made we've more. So, and to to around we got balance right say, of used a to early some and that starting that's business off weeks,

And so, and than more move fill really, last these they team to I of make think XX weeks. did for hulk our freight really maybe to in the trucks trying the hunt some efficiently gaps combination the to of

I meetings a pretty say, a networks, school gaps, would we're fill we're gone because a -- accountability I that's to or I little in it's network. process, our probably think X think week, on tight old it's these and everybody X

loads on XXX we're of the and And days, talking talking loads, they this so, spot we're couple in -- thousands a be. a it get right it thing XXX right couple -- needs lot the loads doesn't not of take to where a

I is tackling peak of up doing. and blocking and by followed a on what that would just it's And think bit say, -- I then anyway, little we're So part.

Daniel Imbro

business. over side of shift maybe the Dedicated then And to helpful. That's

live strengthening right, the quarter, accretive fourth I [ or a should I be just that remember ] think should bird standpoint. here if from -- be mixed in

[indiscernible] about in live think fourth the of you do bird we or that any would near Dedicated in offsets strength term the offset there from how ]? Are [ So benefit the that should be in maybe quarter? aware

M. Bunn

the And that'll I continue third adjustments would Yes, quarter. few this business I we do stronger. some with fourth really you'll to and -- be will Christmas, to just have think that's the had to in business will customers quarter starting now strong effect keep that, in the week. We're roll quarter rate get seeing of. some poultry will a it be the say, between full

say, is I'd Dedicated I and so, the quarter. get think quarter And I'd materially the versus fourth say, don't puts will don't will think takes, evenish probably get better, I third worse. it it but

Daniel Imbro

Great. are down loose mentioned we me, Maybe next better cash You've cash. more the are being out you How Appreciate given seen margins last downturn? there? one about out opportunities it. on M&A if I the getting you get free for I thinking the anything getting spit CapEx rate. else And just side, flow year. should guess prolonged shaken

M. Bunn

you, looking environment, have of OTR environment. we're to our that's good everybody not knows with general things freight we tell continue across a And come competing the think niche, number competing I for. not what it's would desk. stable, business margin And all I with the

business to any the those, right think to cash but we look model. do burn to will the time And it's something, deal right have so, be at pocket. going I at the we right in If to our let not a hole with we're continue going

to just the or evaluate and next going to And so, what happens so. see continue we're year over

David Parker

right the building reduction, would in I probably reduction is out bit would is the cash. any acquisition, the the being for I do quarter. But right sequential cash. I the Paul's saying sort leadership has the patient, acquisitions, like continue just finding couple during And team. say. over Daniel, net X that I would a imminent comment have right we've that. for X that of the mean, culture, playbook debt we're changed, you I I basically of on net playbook. not last saw with successful for which little to or acquisitions that right a would Yes, echo was say, of got last going cushion been -- not acquisition just just our But fit targeted us And of It good that's a really us, the And a acquisitions, that mean. And -- there. to I we've say key

playbook, I and you'll So following think it. we us like see continue our

Operator

next from question Jeff Kauffman Research And from Vertical our Partners. comes

Jeffrey Kauffman

brain that very kind term the I on a in difficult seeing the market's quarter know of and fourth in Congratulations want environment. of your dislocated. beyond the the look all to We market. you're kind pick longer

how you've we're what arguably weakness started. But talking long this high the flow structurally you I of has ebb normal we off and market? think more are just what kind been, in coming we're of of downturn do the think kind people a about changes sugar seeing although the as when short-term market versus seen

M. Bunn

decks there, to of ones these I'll get interested say, may mean, I throw a not good. continue would really continue to may on. some will businesses out or on couple even about the specialized things and we in, I perform Specialized businesses well. things of tie we talked be do that Daniel some into really

their think during cash money, the just a 'XX, the just of this second going I negatively structure. of made much that that well so lot at reserves affect have crazy and 'XX rebound, had into cost to ability and along -- for basically this the margins and small half below taken with proliferation to carriers thing continues brokers market of the freight

businesses a defy I'd the, And last operating and that's fundamentals. on economic long say, months small businesses, with, so, space, the say, that a economics, some of pretty return should, good small a that capital, call that People that's they commoditized and on and to that especially transportation you still get decisions they've in of the up your it, just that you proliferation -- really lasted run a of during companies not bunch still I those that get kind businesses up, is I'll COVID if time. blew would outside something blew that the XX are of business brokerages are, got made of and bidding like

David Parker

yes. agree XXX%, I

Jeffrey Kauffman

So want point, just for feel to we're down will, this to I on, point businesses. comment your the we But niche I mean, I strategy, love to here. you then go we're of specialized out on almost this the like your if bullets at back niches really turn, in are in waiting hatches it the used exposed kind batten sense patiently that than the as and more we is market? heavily of or that there aren't today they to make you

David Parker

I of those. think both it's

I both, this turn. think you that to be to the down that when need and going and batten to is prepared do hatches, thing is

automotive will the and there's feel that. housing, lot rates. of is next are coming be Now, going or important very I going did, if that, rates, will what not, a lot I that's do freight that and a they've interest straightened got if felt, paint in XX with picture yet freight also I they think to in going note. there's Fed, and that going months the to And that be can know a another side we're I few the the XX to a start to continues but basis interest Fed don't XX? election reduced of say lower It's to inflation election. points, personally in they a out forth they But

aside, rates kind the today, I where is few goes way, other at the that way, going freight I to we it's I it think is next on if months. but be we're goes whichever out President may going what I some have If of interest help doing it Fed think the to in think transportation think wins election, the one there. more

time, your get to we some that look so said, side ones the Paul you're same that, continue as niche and going make think sense. sense, down. you at the and batten help, then, other make of hatches The At I acquisitions to

And has in interest a matter find the just the our we're so agree one future. company the or find you building way which in if the that upon, the because one can that's it's you that

M. Bunn

Does that help, Jeff?

Jeffrey Kauffman

that tremendously No, helpful. was

our because there of but kind of agree is slowly, your it's would to parts there coming I out path, the think 'XX positive isn't too outlook of terms that in a capacity that we or Just here, negative, housing, make of be outside out following along going just to all savior economy? material difference, anything

M. Bunn

Great question.

industrial I folks would just public think prior help. with life from in I've going production stuff. to accounting honest And definitely you, and up my a few talked some be domestic I'll

this matter production the a between it's And people a piece the post-election, you in election of think wins. lot industrial no the right I on might sitting pickup rates of see just slowdown, a production I There's old year who thing. think industrial now interest sidelines in election.

be CapEx auto, think so, would beneficial think those that, spending, all I really fueled by I industrial think to think things production, And housing, I I us.

Jeffrey Kauffman

considered, decision congratulations would agree, I No, things and all thank you. paralysis. Break that up be very Well, helpful.

Operator

from Newland question Michael Capital. next our Vermut comes And from

Michael Vermut

through Fantastic all this. operating

everybody yourselves certainly separated out from else You there.

cash the back situation, flow So, already, be it'll I to youngest coming getting got just down. fleet CapEx, we've assume, the

by, start next do If flow you we're the trading point, next group's if discount free, X we'll of X the XXx to cash massive something over about generated We're acquisitions, amount you optimal back don't you there buying X, spot to we cash flow we'll pretty Is you just come find free like XXx years, math X Is years X with free stock? that, going think if get leverage here. and Where there these large is you years, then X to but an XXx, to, a -- close. could here, we're debt the the the maybe, now, do look much the acquisitions have over at no this? to trading be that, at significant.

at So how that? do you look

David Parker

us, say love started it that years doing X we've and going was down when Street ourselves, back of of would than a to to I somebody's that or we're that bunch ourselves said changed going this I and track Wall nothing us, -- internally tune love love ago has acquisitions. we stock buying the loved to

way us go. avenue opens is the for whichever So we're up going to

M. Bunn

what the math's going be to The math's be. going to

David Parker

be, and done The we whatever X math's acquisition what it's we're do can past. the with continue then of I'm all comes, cash, we've to happy doesn't, you us we and to be it it, either with acquisitions, in but to do going something and know those, do -- great if to going going and can expect our to a

So to is way, up opens I the us Michael, that whichever want way go.

M. Bunn

volatile be or same what headwinds the of keep continue I we much Yes, some to X had to XXXX. people fantastic that, that the Jeff, the there's And kind XX-year very we've that restructured overcome, told mean, message allocation, performed. I'm try look and XX-year, our good in when quarter. we and different that last with was can company, gotten think those control mentioned don't going headwinds that business I on than see happy the I And capital come have our We've X don't I I longer end much we insulated, lot The of of I throughout We're allocation that at of yet. more we've you're great they best attention a what the can tail I changes. things very X.X kind investors we at over the execute years to but level, thought of to seen because years. But with the would are is X of a of position. I release. very, I structural say would and more pretty is significant maybe quarter, more to of A thoughts. you've in our focusing for blue going high try there pay averages company, things, of we're X we've at a again, go, like, And and that a would it mean, be resilient, a echo in at that to this working. the very, our just playbook. be sky ahead Mike, how think history much more significantly last had David's suggest playbook, part clouds. came think us And efficient, still just get frustrated going I acquisitions. it's I'm more and capital we're a poised think like We growth.

Michael Vermut

Excellent.

of One others. the much in now model may leverage much releases your you you last and not a the have upside consistent, of lot is things, more as discuss, as

income That's dramatic assume, when last the took that. still like look down the operating because years, over leverage. an X million, I have X at capital level, on million shares You'll you structure, I something upside think you X

not the be So capital line. leverage, saying leverage that you've the dramatic forever, will so up line, the income bottom I'm really bottom that it's the on right? line, structure there changed

David Parker

right. right. That's That's

I'm it. so, excited And about absolutely

a in going down not some of OR I the where There's investors, still there's think read is and are back, we the still a volatile remind deviate. trough team on. materially more are, to And I've has contractual, we've mean, we're mentioned. X before company. pulling directions, been reason fact, going are the rope all the past, our market. I the were we're in in for different profitable, again, things of have down, our continue we fundamentals us releases path so more the that but more improved solid, in to we count the conviction that business, stable, a a same we've the and that, full different being share to pulled it's We they're company, we no

continue like think longer the the gives every so, that said, there's, I that over that And me be indicator I believe to me we're going makes successful confidence term. to

Michael Vermut

be Eventually, guys. it'll right. Congrats, Excellent. All recognized.

congrats. So,

Operator

Moore comes from question Dan next Scopus. from Our

Dan Moore

Congratulations of wanted I've of kind kind as like framework. earnings in the on again Had as comments. spirit asked, long of a pretty been I you This to term we questions by everybody couple and questions reside. a else's already echo downturn is where of a dovetailing as nasty some seen. and longer to of on this I've that have a great been quarter ever a run idea me to while. good It seems about trough And doing have a

volatility, to long basis do just capital business a a minute i.e., cycle look and two that a kind rate speak have you opportunity the glide a for context, in in business of go can is share to, past? lot to well of points to the XXX stability ago. With because not take up margins, we cycle in of as like to spend It relative or terms to to a cash maybe, mentioned Tripp, of assume to XXX% way me to cycle, to the few like So, as improvement a like earnings repurchases. market, exists used that power margins -- up and going add in of points, next free it's flow improves, opportunity, the both seems that next growth the Can on it's profits in path redeploy what terms you the higher I'd of an you. And percentage see of just some and improved what been years can minutes, improve that unreasonable XX could of the you're earnings we're rates by model, this we the see is today what few to that you of for going the what XX see leverage. type think but not

James Grant

in -- be that. happy you adjusted And how we you earnings through period I'd $X.XX. think I -- it without at his to year, talk year Jason, look or million on operating miles, is very taken $X earnings, David that just factor and very, if lot from much it winds earnings costs, I a I the in walking bottom this, million of through XXX rate the mean, cost, there line. an increase fall you think at I think on I look last it's were the I of year, using this if And or that came we've we've number, I if predicting if of mentioned, when mean, somewhere I'll performed to our number being just come think, income. We've think Yes, to last at up this somebody was I'm a well anything, going else in Jeff our down not hung perspective. I $X, to X% use we around maybe about

progress -- million right now, bit of And to not to little bottomed stronger. think, because and job think see expectation higher They $X them And that you're felt also over kind an every of grow TEL of have an so in of and and equipment over the debt they've $X.XX, They've But have business. the going translated at longer freight but doing I interest look this as continue out down deploy, got the if get outstanding to TEL, some a strong that is growing see they've EPS. long-term up they've of you rates. you'll downturn, business. a good in term market, I gone lot done over make it's trajectory on their their like I

we because business, a can 'XX I for back and our earnings So don't our sub-XX biggest realistic to numbers goals But long-term. our any and 'XX wildcard segments in out all -- to don't want I think Managed segment, not Freight really certainly Managed you and is look perspective what an from it put the Freight is see X did, OR in have in there. a of segment,

in we see on be and value grow growing going customers or the you'll So, and our Dedicated Expedited control, business to focus our think add profitable we do. that profitability segments, we can and and to, I improve our is focusing that things

look customers as that we with sufficient with grow add partner return provide value very us to and customers with, that well. good as I to think and continue and mix of a we a that have happy to, We we're today they grow, we're to and going to

of a significant pieces, in but So, and think I lot there upside. moving there's there's things

year, not definitely kind the I may answer upside guess I see 'XX there's what say. Does 'XX earned was to You would Dan? we in your question, of our earnings, cap that but or,

Dan Moore

years. significantly type kind that X% could result whole just suffering of we over it and that candidly from next higher a I to improvement. earnings a the XX% And of is -- doubling industry it's No, couple would -- of from you rates the move would course see like the rates Yes. something at depressed strikes me that leverage realize that to XX% of in wouldn't close of the

thinking offline A great last should heavy years how off, I to quarter. maybe the yes, of quarter. be you these more get So, a with forward said, after and talk the again look and like congratulations here of over again certainly following of that paid some to sense lot that better up some we businesses. about I'd being December But of on a just lifting couple about

Operator

the to for like are over back remarks. And at this to turn time, there call no questions. further I'd Tripp closing

James Grant

fourth results. us July our forward for quarter and day. Thank everyone. fourth you look quarter the thank joining with Have for Logistics. today, for you you good a or in speaking in your Covenant right, interest in We to or All January

Operator

you This call. concludes today's conference attending. Thank for

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